Friday, April 30, 2010

Worth watching

Leading consumer indicators

Hello all, been a while since I visited the site but i thought this might be of interest to some of you curious as to whether we are working with a real and sustainable recovery. The linked site has some fascintating US data on consumer spending which paints a far less rosy, and probably more reliable picture of a consumer led recovery, suggesting perhaps this time stimulus on its own will not work. I guess that our leaders will probably just force more stimulus, if that turns out to be the case and continue to refuse to look at underlying issues. Then again one can only hope.

Posted by bellwether @ 08:39 AM (3388 views)
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One thought on “Worth watching

  • Hello bellwether. The US recovery is not generally considered to be a ‘consumer led recovery’. It is being tagged as a ‘manufacturing led recovery’. Manufacturing led recoveries tend to eventually lead to a consumer recovery with a lag period of about 12 months. Consumer led recoveries are usually considered to be less sustainable than manufacturing led recoveries because they are not as good at causing the positive loop implied in my last sentence. Here’s a link to an article that puts some meat on the bones of the ‘manufacturing led’ tag

    http://www.businessweek.com/news/2010-04-15/production-in-u-s-probably-sped-up-as-factories-led-recovery.html

    There is an element of ‘semantics’ in the manufacturing led versus consumer led argument but on balance, I think that it is worth making the distinction

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